tv Titans at the Table Bloomberg January 4, 2015 8:30am-9:01am EST
>> tonight on "titans at the table," we talk football and the big apple. >> there will be a coin toss right here. >> with the man who is bringing it all together. jonathan tisch, co-chairman of the loews corporation and co-owner of the new york giants. he was born and raised in a new york family. in 1959, his family branched out and bought loews theaters. today the loews corporation has $80 billion in assets that generate $15 billion in annual revenue with interest from everything in hotels, insurance, oil and gas. jonathan tisch runs the company with his cousin and is also the chairman of loews hotels. >> he took this area and made it guest friendly. >> he completed a massive luxury renovation of a flagship hotel that is near and dear to his heart.
>> i grew up in this hotel. >> but that work has not stopped him from writing three business strategy books. >> you get about six hours of sleep? >> 5 to 6 hours of sleep. you will get an e-mail from me at 3:00 in the morning. >> despite a demanding schedule, he tries to make it to every giants home game. i caught up with him at his team's home turf -- metlife stadium. ♪ >> it is incredible to be out here. how does it make you feel? >> pretty amazing.
i think of my father and what he went through to afford us this opportunity to be partners in the giants. >> in 1991, bob tisch, john's father, fulfilled his lifelong dream when he bought a 50% stake for the giants. today, the team is valued at an estimate of $1.3 billion. it is co-owned by two families. if loews corporation was a football team, what is your position? >> probably the coach. i'm not there day-to-day. very much true in the hotel business. i can sit in my office on madison avenue, but i'm not checking people into the rooms or making the beds. in that regard, i guess i would be the coach. understanding what is in your game plan, the playbook, and then you have to articulate it, and then you have to perform it. it ain't easy.
in the hotel business, 365 days a year, 24 hours a day, seven days a week, and you have to get it right every time. >> i know your family is a big football family. why do you like it? >> you never know what will happen. a play can change the course of a game. a pass could be intercepted, a ball could be fumbled. you never know what will happen. it is exciting. the fans get involved. people are aspirational when it comes to their players. that puts more pressure on us to make sure the product we are putting on at metlife stadium is the best that it can be. with technology today, it is very easy to sit in your man cave, woman cave, and watch a game. but we want people to come out and experience it live and sit in the stadium -- 82,500 of them. we want them to say was an enjoyable experience, and yeah, maybe i sat in traffic and maybe snowflakes fell on my head, but that is part of the experience.
>> filling all 82,500 seats at metlife stadium is no easy task. the stadium is in east rutherford, new jersey. it is just across the hudson river from new york. metlife opened its doors four years ago. jonathan tisch was instrumental in getting it built. it's the only stadium that houses two nfl teams -- giants and the jets. it's also the largest in terms of seating capacity. all of those seats came with a hefty price tag. >> this is an amazing building. it cost $1.6 billion to build. people say to us -- why is there no roof on it? that would have been another $400 million. it is important to note that there has been not a dime of public money in this building. it is all privately financed.
it was quite a remarkable accomplishment. >> the stadium will be in the spotlight in early february when it plays host to the most-watched sporting event in the world -- the super bowl. >> super bowl is a great opportunity for this region, for new york and new jersey. this is a super bowl of a lot of firsts. this is the first time it is being hosted by two teams, the jets and the giants. the first time it is being hosted by two states and one big city. the first time the game is being played in a northern city in a building without a roof. >> bringing the super bowl to the new york region has been a decade-long effort for tisch. it began after 9/11 when he began pitching the idea to nfl and local politicians as a way to jumpstart the stuttering economy. it was not until the metlife stadium was built in 2010 that idea caught on. >> the nfl owners liked to bring the game to some of the newer stadiums to highlight them. they wanted the world to see this great facility. >> millions of people around the world will be watching super bowl xlviii. perhaps no venue is better prepared or staffed for an event like this. 20 times a season, metlife undergoes a transformation.
a staff of about 20 takes two days to change it from one team to the other -- from jets green to giants blue, or vice versa. that includes the removable endzone. the turf from one team is rolled up and stored under the stands and the other team's turf is rolled out. special end zones will be rolled out for the broncos and seahawks. that is about all nfl is saying. >> what are some of of the cosmetic changes being made at the stadium? >> you will find out when i find out. >> you don't know what the stadium will look like? >> i know we are standing on the 50 yard line. [laughter] that's not moving. i know on february 22, there will be a coin toss right here. >> together with the owner of the jets, tisch is the
cochairman of the super bowl committee. they make sure this stadium he helped build is ready for the big game. >> it's a lot of responsibility. what keeps you up at night? >> what keeps me up at night is the scale. the sheer number of things that have to get done, the sheer number of issues that we have tried to think of, to plan for. power is the big issue here. remember, there was a blackout that affected the game at the mercedes superdome. >> can you guarantee no power failures? >> so much work has gone into ensuring that there will not be a power failure. there are contingency plans. generators on-site. you never say never. you cannot promise 100%. we have done a lot of work. due to the security perimeter that will be built around metlife stadium, we're losing half of our parking spaces. we are trying to call this the first public transportation super bowl. we are working closely with the mta, with new jersey transportation authority to make sure that buses and trains will transport people to the games. >> i can hear new yorkers. you know them. they will say, what? i'm getting out of the city during super bowl. what do you say to that? >> my advice is do not to leave town. there'll be a lot of fun and excitement. >> they will say you know, the traffic and the hassle. how will i get to work? >> they will say that anyway. new yorkers do complain.
but new yorkers are very generous of spirit. new yorkers appreciate when something special is taking place. >> another problem -- mother nature. >> there had to be a rule change in terms of us being able to bid on getting the super bowl. there was a rule that if it was an open exposed stadium, it had to be in a city where the average mean temperature the day of the game is above 50 degrees.
that is clearly not the case in february in the new york and new jersey area. >> they changed that rule for this game. it went away. >> the stadium has a team of 1000 at the ready to clear snow from the stands with a network of chutes. facility operations vp dave duernberger says they are ready for the snow. >> we put a snowmelt on the 300 concourse, and one down here on the field. we have a 600-ton snowmelter we can use in the parking lot. they have a jet engine inside. the heat that is produced from the jet engines is what melts the snow. >> it is a big operation. >> no matter what the weather, it will be a great day. >> some of the greatest games in the history of the nfl have been played in inclement weather. it may snow, it may rain, but it could also be 45 degrees and gorgeous. super bowl xlviii at metlife stadium will be very exciting. we want to make sure that the region knows that the super bowl has been here. >> when we come back, jonathan
>> the regency hotel at the corner of our avenue and 61st street has been an institution since the day it opened back in 1963. in january, to celebrate the grand reopening. jonathan tisch, chairman of the loews hotel, was on hand to welcome the guests back. just a few weeks before it opened, we met tisch for a sneak peek of the hotel. workers were buzzing around putting the finishing touches on the lobby. >> the loews regency hotel is our flagship. 50 years ago, my father and uncle opened this hotel. it was an integral part of how they wanted to build loews hotels, which has today morphed into the loews corporation.
the hotel business is at the root of where our family started going back 75 years ago with hotels in new jersey. this hotel has become very important to the image of loews hotels. it has become very important to the bottom line of loews hotels. i grew up in this hotel. since i was 12, i have been walking the corridors and the back of the house and know many of the workers who have been here since the beginning. >> you stayed at this hotel yourself. >> emotionally, there is a connection. physically, there is a connection. financially, there is a connection to loews hotels, loews corporation to the family. >> what was the most difficult part of renovating this hotel? >> the challenge we faced was once we got into that building and went behind a wall, i came to the realization that my father and uncle, god bless them, did not spend a lot of money when they were building it 50 years ago. we found some conditions that made it challenging to rebuild at the pace that we were hoping to. >> structural issues? >> structural. because of super bowl, we knew that we had an end date we do not want to go beyond. we had to scramble. >> you have spent $100 million.
it was the most you have ever spent on any renovation. why so much? >> we felt $100 million was necessary to bring the regency back to a place that befits the neighborhood, but also the vision that we have for this hotel. the $100 million mark not only includes the rooms and the corridors and the restaurant and the new fitness center and the salon and the new lobby, but we replaced every window. the windows were 50 years old. guests will appreciate that. we're looking to raise rates 20% to 25%. that is not a small amount, but we think the products and service will warrant that rate increase. we totally took this area and made the area guest friendly. >> the renovation costs bloomed from an initial estimate of $35 million to the $100 million.
but tisch says it is all part of his plan to boost the image of all 21 of his loews hotels. >> how long before you can make the money back from the money you put into it? >> it's hard to look at a real roi in terms of every dollar and every penny. not only do we want to get economic return, but what this hotel means to loews hotels from an emotional standpoint, you cannot quantify. we had to make a commitment that the flagship hotel, a block from our office, in the heart at new york city, is at a standard that represents the rest of our organizations.
we are continuing to grow. in the last 18 months, we bought three hotels. we bought one in california, one in boston, and one in washington, d.c. markets we wanted to be in. we have two hotels under construction from scratch. one is in chicago. another hotel in orlando. our fouth hotel in orlando is on the ground at universal studios. it comes back to new york city. the focal point of the u.s. travel and tourism industry. you could probably make the same statement for the world travel and tourism industry. we want to have a property we are proud of. and make a good return on investment. >> any return on investment for the hotel depends on visitors to the city. tisch has worked closely with the past mayors to improve new york city's gritty image. he helped kick off the new york times square makeover. he was instrumental in the campaign to bring tourists back after 9/11. so far, his efforts seem to be working. new york had 54 million visitors in 2013.
the regency sold out for super bowl weekend about a month before it even opened. it is not just about keeping hotels full. tisch says tourism is critical for the new york economy. >> what is it really about? >> it is about the jobs. it's about good jobs. it is about the ability for visitors to come and spend money so we that can hire more new yorkers. if you look in new york city alone, 330,000 people are making a living in some aspect of travel and tourism. we are also reaching out to the right visitors. that international traveler is extremely important. the international traveler stays longer and spends more money here. >> since 1970, the regency has been home to the power breakfast. business leaders and politicians would convene every morning over coffee to get their day started. >> you look at the history of the power breakfast. it was started 45 years ago by my father. >> your father and your uncle, right? >> my father and my uncle. these were the times new york city were in very dark financial shape. the leaders of the city at the time came together to talk about
how to save new york city. >> and they did it right here? >> everyday they would say, where should we meet? my father said, it is a bit selfish on my part because all i have to do is take an elevator, but let's meet at the regency. [laughter] that is literally where the term -- in the mid-70's, where the term power breakfast started. we will re-establish the regency as the home of the power breakfasts, the place where people want to come to see and be seen. >> coming up, what kind of hotel room does $100 million buy? what is the most expensive part of this room? >> the bathroom. the bathrooms are very, very expensive. ♪
>> just before it reopened, jonathan tisch, chairman of loews hotels, gave me a tour of the newly renovated loews regency in east midtown manhattan. >> here we go, betty. after you. >> all right. newly renovated rooms. you have designed -- you picked out almost everything in this room. >> i can tell you stories behind the carpet, behind the finish on the dresser, behind artwork, behind the pillows. so you start with carpet. you have a color idea. they will come in and there might be a gray scheme. it will be presented as a warm grey scheme and then a cool gray scheme. >> this is what? >> this is a cool gray scheme. >> the regency has 380 rooms, each one brand-new, with almost all of the design elements selected personally by tisch himself. the most expensive part -- the marble bathrooms. >> the bathroom has become a point of competition. a lot of new hotels have big bathrooms and they sparkle. we wanted the bathrooms to -- >> i noticed there was a television. >> we have televisions in the mirrors.
every bathroom has a tv in it. >> one thing i have to ask is do you test the mattresses out? >> i have tested many. my wife and i have stayed in this hotel. it is comfortable. >> it's pretty comfortable. do you do this in every one of your hotels? you pick every piece of fabric -- >> we have lots of renovations. we bought a hotel in hollywood, california. we finished up a $30 million renovation. in nashville, tennessee -- $12 million on a new lobby and restaurant. we redid all of the guest bathrooms. i pick every fabric. >> what is it like? you walk into a room and say yes, yes, no, no? >> i will sit there with designers, and they will show lots of different fabrics. i will ask to make it greener. can you make this bluer? can this be darker? lighter? we will be in their offices or they will be in our offices throwing around different fabric swatches. >> do you have an idea that this is what the room will look like? these are the color schemes? >> i did, but it took us a few iterations to get to the point that we as a company were happy. when people ask me what i would be doing if i wasn't in the hotel business, i really quickly admit that i'm a frustrated architect.
>> you love this stuff. >> i really do. >> some people would go nuts having to make all of those decisions. >> i get excited about what we can create. >> it is a good thing tisch likes picking out the wallpaper because the lifespan of soft goods in hotels, things like pillows, carpets, chairs, drapes is only about six years. a major renovation like this is a major gamble for tisch. he admits it will take some time before he knows that it was worth it. >> you make decisions that you hope are right, and you will not know the answer for six months to a year to see how your revenue numbers start to come in. believe me, i'm losing a lot of sleep over it.
my wife asked me, what are you worried about? i said -- what happens if no one likes it? >> he might have reason to worry. the hotel industry is a fickle one. the industry tends to rise and fall with economy, and the big chains dominates. >> there are so many good operators. lots of companies that are very good at what they do. there are lots of options. if somebody checks out here and they see that they pay a couple of hundred bucks and were not happy, all they had to do is walk out the front door on park avenue and take a right and there are some great hotels to the south, great hotels to the north. and now with social media, you have to find a way to differentiate yourself from the competition. you have to offer a product and service people can relate to and feel good about using. >> but specifically, how do you make sure that loews differentiates itself from a marriott or a hilton? >> when our new hotels are done, we will have 21 properties. we are much smaller than the big-name businesses. we will be competing against a hyatt and the fairmont.
we could be competing against the four seasons. why people want to come back here is about the service. they say, betty, welcome back to the loews regency hotel. >> it is a welcome tisch is extending for many this year, including nfl fans, new york tourists, and most importantly, his regency hotel guests. a lot is riding on a simple hope that they enjoy the new hotel as much as he does. >> it is our best shot at it. we spent $100 million to reinvent the loews regency hotel. but always coming back to the basic great service, but now in a new box. ♪
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